Feb. 29, 2012
Snowbirds aren't the only folk flocking to the Sonoran Desert this winter. Hundreds of construction workers have moved to this sun-drenched stretch of rock and mesquite brush straddling the Arizona and California border to build massive solar farms, some financed in part by GE.
GE Energy Financial Services just invested $100 million in a 127-megawatt solar farm located near Arlington, Ariz., population 194, about 40 miles west of Phoenix. Last fall, the GE unit said that it would help finance a 550-megawatt solar farm located across the state line, near Desert Center, Calif., population 204.
The power plants are as large as the towns are little. Together the two solar projects will generate more than half the amount of power produced by one unit of the nearby Palo Verde nuclear power plant.
The investment will swell the local population and open hundreds of constructions jobs. The projects will generate enough electricity to power 213,000 homes and displace 515,000 metric tons of greenhouse gas emissions per year. That’s the same effect as taking 98,000 cars off the road.
GE Energy Financial Services has committed over $8 billion to renewable energy, with funding commitments for solar projects now reaching $1.4 billion. That’s more than twice the amount at the start of 2011.
Solar farms have become an attractive investment because innovation and technology efficiency have lowered costs and allowed operators build large-scale projects. “We made a conscious decision to try to grow our solar investment,” GE Energy Financial Services’ President and CEO Alex Urquhart told Reuters. “We’ve been successful, in fact more successful than we thought.” The unit’s gigawatt-size solar portfolio now spans 48 power plants in six countries in North America, Europe and Australia.
Kevin Walsh, managing director and leader of power and renewable energy at GE Energy Financial Services, said that the size of the largest solar projects skyrocketed over the last four years, from 11 megawatts in 2007 to 550 megawatts, as electricity production costs dropped as much as 70 percent, between 10 and 15 cents per kilowatt. “Those are compelling numbers,” Walsh said. “It got the utilities interested.”
GE Energy Financial Services has amassed an eclectic renewables investment roster: It has backed solar, wind, geothermal and other renewable energy projects. The unit has joined venture capital firms like Kleiner Perkins, Google Ventures and North Bridge Venture Partners and invested in startups like Alta Devices (solar panels), Cool Planet Biofuels (biofuels), and A123 (batteries).